Rural residential to farm

[hunterfisher]

Hi all just curious what people have been doing to move away from Rural Reaidential property Tax to Farm Tax? Just seeing what is required as I may lean to that direction. Thanks in advance.

Ps-I mean small hobby farm

[josey]

Originally Posted by hunterfisher

Hi all just curious what people have been doing to move away from Rural Reaidential property Tax to Farm Tax? Just seeing what is required as I may lean to that direction. Thanks in advance.

Ps-I mean small hobby farm

It's all in the zoning. Whatever your property was zone at will be taxed. You would need to apply to re-zone your property. Depending on your reasons, size and the structure plan of your county etc. they might do it. Read your by laws and see if your property would even fit into the farming category. Most likely they won't go for it because it means less taxes for them.

[I-Love-Eyes]

I would ask in your county about the zoning. I know that in order to qualify for farm tax rates, you must earn an income of $10,000. or more from the property.

[josey]

Originally Posted by I-Love-Eyes

I would ask in your county about the zoning. I know that in order to qualify for farm tax rates, you must earn an income of $10,000. or more from the property.

That $10,000 income has nothing to do with your property tax.

[bonedogg]

I was under impression that you can't be taxed as a farmer unless the parcel of land is 40 acres or larger in size. I hear anything 39 acres and less cannot be classified as such....... nothing to back it up though.

[obsessed1]

Originally Posted by bonedogg

I was under impression that you can't be taxed as a farmer unless the parcel of land is 40 acres or larger in size. I hear anything 39 acres and less cannot be classified as such....... nothing to back it up though.

Not in our area. All depends on how it's zoned. Usually they won't re-zone to farm unless you can prove a working farm on the land. Ie res property sub-divided off an original quarter that's purchased by farmer and is reclaimed as farm land. Counties rarely re-zone to a lower tax amount

[josey]

Originally Posted by obsessed1

Not in our area. All depends on how it's zoned. Usually they won't re-zone to farm unless you can prove a working farm on the land. Ie res property sub-divided off an original quarter that's purchased by farmer and is reclaimed as farm land. Counties rarely re-zone to a lower tax amount

This. Also „hobby“ is getting you nowhere. Farmland rules are getting tighter and tighter from the province. The regulations are very clear on “for profit” farming.

[hunterfisher]

Thanks guys. I heard about the fact that there’s an earnings requirement. Not to sure but I’ve heard of a few people in the area who have 4-6 acreas with horses and/or Chickens that claim it to be a hobby farm in order to pay less taxes.

[Norwest Alta]

I'm not sure but believe you need 160 acres and need $10000 in transactions to claim farm status. You don't need to make $10000 in profit. I think the land base is important because anyone could go buy $10000 in cattle and pay someone to pasture them.

[TrapperMike]

Land base is not a requirement. You could set up pig or poultry barn on 30 acres and make a decent living, thus you are now a farmer.

[Smokinyotes]

Pretty sure it’s based on gross farm income and not land base. Knew some pig farmers that only owned a few acres and bought all there feed but had significant farm income.

[Goncutn]

There seems to be some confusion to what qualifies you to be able to get your property to get taxed at an agriculture rate. The $10,000 value is a gross $ number of farm sales required to be able to get a AFFB # to be able to buy dyed fuel for farm use. In all likely hood, all counties in Alberta only allow farmland (tilled and grass) the agriculture tax assessment, farm yards are taxed at a higher rate, depending on the structures on the land, some are taxed at different rates, ie; old grain bin is taxed at a very low rate as where a new grain handling system is taxed higher but not a a commercial rate. And the same applies for a old 80 year house compared to a new 1.2 million $ house, the new house will be higher but not the same as in the city. There is a number of rate reductions for buildings on farm yards if the owner is a actual farm land owner in that county. Likely you will not get any tax reduction or reclassification of your acreage if you don't have any other farm land in that county or if your acreage is under the minimal size, each county has a pre-determined size of property where it would not be considered a acreage, I have seen in Cypress county where 40 acres was no longer considered a acreage. Size and tax rates are going to vary by county and ag exemptions will also vary by tax assessor, I have first hand knowledge of this.

[josey]

Goncutn describes well how PROPERTY tax works. Don't confuse that with INCOME tax, that's where $10,000 income etc. will matter.

[260 Rem]

Try as you may, you can not avoid taxes or death. Both are a certainty.
I suspect in most municipalities, the first three acres are taxed at “residential” rates regardless of parcel size.

[MoFugger21]

https://www1.agric.gov.ab.ca/$depart...2?opendocument

For income tax - It all depends on gross income and what your main source of income is - nothing to do with size of farm.

Farm income is farm income - there is (generally) no difference in reporting farming income from a 'regular' grain farm or 'hobby' farm with chickens, etc. It's all reported on the same forms and all added into your income the same.

The differentiation comes from when you have a loss from farming operations. If farming income is not your chief source of income, you will have a restricted farm loss - 100% of the loss cannot be used to reduce other sources of income.

https://www.canada.ca/en/revenue-age...farm-loss.html

I'm assuming that is what you're after. If not, PM me.

[FCLightning]

Originally Posted by 260 Rem

Try as you may, you can not avoid taxes or death. Both are a certainty.
I suspect in most municipalities, the first three acres are taxed at “residential” rates regardless of parcel size.

They are here. No subdivision but the yardsite is assessed at residential rate and the rest of the land at farm rate.

[darren32]

Originally Posted by josey

It's all in the zoning. Whatever your property was zone at will be taxed. .

Not in Parkland county. I have a 1/4 zoned "AG Agricultural general district" but the county taxes me as "CR County Residential". They (apparently) spotted my trailer parked on it and that was reason enough for the higher tax rate with no change in zoning.

[josey]

Originally Posted by darren32

Not in Parkland county. I have a 1/4 zoned "AG Agricultural general district" but the county taxes me as "CR County Residential". They (apparently) spotted my trailer parked on it and that was reason enough for the higher tax rate with no change in zoning.

They would have to properly re-assess you for the improvement. I wouldn't accept a tax notice without a proper assessment.

[darren32]

Originally Posted by josey

They would have to properly re-assess you for the improvement. I wouldn't accept a tax notice without a proper assessment.

There was no improvement. I just store my 5th wheel on it. No buildings, nothing on it. 80 acres (not a 1/4) mostly field and about 10 acres of trees.

They DID re asses it. I didn't notice and my wife paid it with the others. That's the problem ..... it's very difficult to go back LOL.

My point is that is is still to this day zoned AG but taxed as RES and there is not much I can do about it. We "accepted it" by paying it. I forgot to appeal the assessment AGAIN last year........

[raab]

Originally Posted by Norwest Alta

I'm not sure but believe you need 160 acres and need $10000 in transactions to claim farm status. You don't need to make $10000 in profit. I think the land base is important because anyone could go buy $10000 in cattle and pay someone to pasture them.

You realize a lot of farmers lease land, and dont necessarily have all of it up front. I think leasing pasture is the most economical way to go if youre just starting out. Not everyone can go drop 500k(and thats cheap) on a 1/4 section of land, plus buy the livestock, plus all the equipment needed to care and move them. Lease the land to start or run your cattle with someone elses and build from there.

[josey]

Originally Posted by darren32

There was no improvement. I just store my 5th wheel on it. No buildings, nothing on it. 80 acres (not a 1/4) mostly field and about 10 acres of trees.

They DID re asses it. I didn't notice and my wife paid it with the others. That's the problem ..... it's very difficult to go back LOL.

My point is that is is still to this day zoned AG but taxed as RES and there is not much I can do about it. We "accepted it" by paying it. I forgot to appeal the assessment AGAIN last year........

True you can't go back (i.e. recover prior year taxes) but you can appeal the current year. Get the current zoning from the county and compare that. They can't just switch stuff around. A 5th wheel is not a permanent improvement and shouldn't be taxed. I am more familiar with industrial property taxes than residential but it should be easy to look up. The only thing might be if you don't farm the land, I know there was some talk about stricter rules for farmland now. You can read up on that too though.

[darren32]

Originally Posted by josey

True you can't go back (i.e. recover prior year taxes) but you can appeal the current year. Get the current zoning from the county and compare that. They can't just switch stuff around. A 5th wheel is not a permanent improvement and shouldn't be taxed. I am more familiar with industrial property taxes than residential but it should be easy to look up. The only thing might be if you don't farm the land, I know there was some talk about stricter rules for farmland now. You can read up on that too though.

Thanks for the info. It is zoned AG per the current zoning map.

[Norwest Alta]

Originally Posted by raab

You realize a lot of farmers lease land, and dont necessarily have all of it up front. I think leasing pasture is the most economical way to go if youre just starting out. Not everyone can go drop 500k(and thats cheap) on a 1/4 section of land, plus buy the livestock, plus all the equipment needed to care and move them. Lease the land to start or run your cattle with someone elses and build from there.

I know this that’s why I said I’m not sure. I’m sure there is someone that lives in a condo downtown Edmonton that owns a herd of cattle. I don’t know how that relates to farm taxes though or if that qualifies him/her to claim farm status? It is my understanding that you can’t claim farm status on a acreage and need 160 acres min. Could be rented or owned.

[josey]

Originally Posted by Norwest Alta

I know this that’s why I said I’m not sure. I’m sure there is someone that lives in a condo downtown Edmonton that owns a herd of cattle. I don’t know how that relates to farm taxes though or if that qualifies him/her to claim farm status? It is my understanding that you can’t claim farm status on a acreage and need 160 acres min. Could be rented or owned.

We have 70 acres. We are a farm but because farming is not our main income they cap your losses. We can deduct losses from our regular income but not unlimited. It has nothing to do with land owned or rented but with producing AG products and having income. $10,000 income only comes into play if you are looking for farm fuel or grants. You are a farmer if you only make $500 in Ag products as long as you produce and sell e.g. veggies, plants, cattle’s etc.

Property taxes are completely separate though. It’s all about the land and taxed is the owner. So if you own a AG zoned parcel you don’t have to farm it yourself, you can lease it out but still get the farmland assessment and rate. You could live in a condo and own farmland and get taxed like that.

Both are completely unrelated.

“Farm status” per se doesn’t exist. What they mean is that you might qualify for fuel or grants.

[MoFugger21]

Originally Posted by josey

We have 70 acres. We are a farm but because farming is not our main income they cap your losses. We can deduct losses from our regular income but not unlimited. It has nothing to do with land owned or rented but with producing AG products and having income. $10,000 income only comes into play if you are looking for farm fuel or grants. You are a farmer if you only make $500 in Ag products as long as you produce and sell e.g. veggies, plants, cattle’s etc.

Property taxes are completely separate though. It’s all about the land and taxed is the owner. So if you own a AG zoned parcel you don’t have to farm it yourself, you can lease it out but still get the farmland assessment and rate. You could live in a condo and own farmland and get taxed like that.

Both are completely unrelated.

“Farm status” per se doesn’t exist. What they mean is that you might qualify for fuel or grants.

This